Retention is the strangest money in construction. It’s yours, it’s written into the contract, and it leaves your invoices automatically. Getting it back is the only part that runs on manual.
The industry bodies campaigning on this put the total locked up in retentions at roughly ten and a half billion pounds; the ECA carries the figure on its campaign page. The government has confirmed it intends to ban the practice, but on the timelines discussed the change is years out. Every subcontractor trading today still lives with the current system: money out by default, money back by request.
The mechanics are why it slips. A typical clause deducts a small percentage from every payment, releases half at practical completion, and holds the rest until the end of the defects period, which can be a year or more after your crews left site. Two release dates per job, each set by an event rather than a calendar date, on jobs that finished long before the second date arrives. By then the site team has moved on twice and the person who knew the defects period from memory has a new job.
So the money sits. Not because anyone refuses to pay it, but because nobody asked, or asked late, or asked without the completion dates to hand.
The fix is a ledger, and it’s almost embarrassingly simple. Per job: what percentage is being deducted, what that has amounted to so far, the two release triggers as written in your contract, the dates those events actually happened, and whether each half has been requested and received. Ten minutes to set up per job. The whole thing fits on one page per year of trading.
Read the clause once, carefully, when you set the row up. The percentage, the trigger events, and any deadline for requesting release are all in there, and amended forms move them. What the ledger does is take that one careful read and keep it alive until the dates fall due, instead of asking someone to remember it across two years.
Whether and when to press for release, and on what terms, is a commercial call for you and your QS. The ledger just makes sure the call gets made by a person, on time, instead of by silence.
Count it once and the number tends to end the debate: most specialist firms find more than one forgotten retention across their closed jobs. That’s not new work. It’s your margin, already earned, waiting for someone to keep the dates.